Letters

Osborne's big economy gamble

I commend the chancellor for the wholehearted way he is pursuing the Conservative party's pro-capitalist agenda in his autumn statement (Report, 30 November). Are there any better ways to improve profits and business optimism than by reducing benefits, reducing the money that goes to the public sector, increasing unemployment with inflation thus reducing the real wage, and then diverting some of the public money to subsidise transport costs for business rather than wasting it on education? He is lucky that the Labour party still thinks that being anti-capitalist and pro-strike is not a "good way" to demonstrate their own pro-capitalist credentials and that it cannot defend any of the deserving losers. It is without doubt a truism that those with "loads of money" are best placed to create more, and should be helped to do so.David ReamsBeckenham, Kent

• Robert Skidelsky (The cutting fantasy is over, 30 November) notes the incoherence of the coalition's plans for credit expansion. In fact, their policies are incoherent across the board, from the NHS to the environment, and none more so than plans to keep people working longer while the young suffer. Unemployment is, and always has been, the most serious of all economic issues. Labour's efforts to switch the debate from deficit reduction to job creation must succeed, and soon.Bob NicholsonFrodsham, Cheshire

• The thing that struck me most about the autumn statement, or "dog's breakfast" as Larry Elliott called it (Report, 30 November), was just how helpless the government appeared to have been and continue to be in the wake of the economic storm that is gripping the world.

We live in a globalised economy where Britain is nothing more than a reed being buffered by forces it has little control over, no matter how many "growth" and "job" plans clever Treasury officials dream up. The debt incurred as a result of the collapse of the financial system is now coupled with stagnant growth, mainly as a result of the feebleness and economic incompetence of Europe's political elite, so that we now face the much feared "lost decade". The answer must surely be to have stronger global leadership, for countries such as China to use their reserves to inject demand into the European and North American economies so as to ensure world recovery. Unfortunately, there appears no inclination on the part of the world's leaders for greater political integration to mirror the economic integration that has been so apparent for many years. Alec BurtYork

• With crucial talks on climate change currently taking place in South Africa, George Osborne's plans to boost the economy by investing in roads and helping energy-intensive industries is as outrageous as it is short-sighted (Osborne's £5bn gamble to stave off recession, 28 November). The self-styled "greenest government ever" should be building a low-carbon economy, not making us more dependent on gas, coal and oil.

Tens of thousands of jobs in the solar industry are under threat from plans to slash solar subsidies. Just a fraction of the billions available to Osborne would safeguard this thriving industry – and help households generate their own energy.

And the UK's cash-strapped green investment bank is in desperate need of a financial boost too. It's ironic that much of the money to fund the chancellor's carbon-intensive investment drive will apparently come from commercial pension funds. Surely this money should be used to safeguard people's long-term wellbeing, not to build a riskier and more expensive future for us all. Andy AtkinsExecutive director, Friends of the Earth

• Futile campaign in Afghanistan – £5bn this year. Unusable Trident weapon system – £20bn. Subsidies to some of the wealthiest aristocrats in the country through the CAP – £25m annually. Why do these all appear to escape scrutiny in the debate over fairly distributed savings? And why not throw into the mix a one-off windfall-for-the-nation tax on, say, the 1% wealthiest, who inhabit some stratosphere untouched by austerity?Raphael AltmanOxford

• I followed the chancellor's autumn statement with interest and was pleased to see the government's plans to support SMEs – both the national loan guarantee scheme and business finance partnership will be welcome to our members.

However, to be successful in helping companies to develop it is vital that support is straightforward and non-bureaucratic. Similarly, while the government is right to focus on supporting manufacturing through capital allowances in enterprise zones and encouraging the export ambitions of SMEs, it must recognise the important role that different sectors play.

The UK leisure marine industry employs 32,500 people and generates sales of £2.9bn per year, including around £1.15bn in exports. Our industry is a manufacturing success story, with many of our members investing in new high-tech equipment and expanding their manufacturing sites to meet the increase in demand.

Focusing on industries like ours, with many small, innovative and high-growth-potential companies, and continuing to ease access to finance for such companies, will be the key to success.Rob StevensChief executive officer, British Marine Federation

• The autumn statement was about expenditure plans and not taxation. Tax issues are dealt with in the spring budget. But this government needs to start thinking outside the box on tax as well as spending to help reduce the deficit and boost growth. Perhaps there is scope for the government to consider levying VAT on food. With average household spending on food in 2009 at £52.20 per week, a 5% VAT levy on food could raise around £3.6bn. Indirect taxes are regressive, but those on benefits are seeing increases in their incomes of around 5% from next April, which should help to mitigate the effects of increased food prices on the poorest families. And increasing the cost of food for consumers should reduce waste and perhaps encourage more people to grow their own fruit and veg. Eating out would also become more attractive as the difference between buying food from supermarkets and eating in cafes and restaurants narrows. What's more, taxing food is not a complete anathema. Within the EU, Sweden imposes a 12% VAT rate on food. And in Norway VAT on foodstuffs is 14%. Roger JarmanLondon

• The government's youth contract is welcome (Bank tax to rise as Osborne set to deliver grim news, 26 November). Their central proposal, of a targeted jobs subsidy delivered through the Work Programme, is what we called for last week in our report, Youth unemployment: A million reasons to act. However there's a tension with subsidies: between paying for recruitment that would have happened anyway, and paying for "new" jobs that then end when the money runs out. One way to square this is through so called "transitional jobs" that pay for new, temporary jobs alongside intensive support to move into long-term employment. Evidence from the UK and US has shown that these can deliver impressive results. The government has a unique opportunity to learn from this and to do something better than the usual "golden hellos" and job creation schemes. With long-term youth unemployment rising faster than at any time since the 1980s, it's never been more urgent.Tony WilsonDirector of policy, Centre for Economic and Social Inclusion